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(generated from captions) been dodgy, but they're still

there, that's what will happen.

You'd have to say the odds for the Muslim Brotherhood aren't

pleases me. But these places

are so volatile, you'd hate to put your life on what will

happen in the next month. Democratic elections, if that's what they want, why that's what

can't they have it? I'm 100%

for it, I just don't have to

like it. Amanda Vanstone?

Well, I agree with Graham

Richardson. It seemed a few

days ago as if his end was imminent. Now it seems there might be some agreement amongst

other countries to help support a transition

is as to whether you can keep

the community happy that that

transition to what they want,

whatever it is, will in fact happen or if it's just a

stalling technique. I'd

personally think that would be

a disaster. You can't have so

many people feeling so

saying they want to move to a strongly, wanting change,

democratic system and saying

we'll manage the transition and

not get there. I think that

would be a real disaster. But,

having said that, you need a transition, you

street with thousands of people

tomorrow and bang it happens. and say I'll be a democracy

It has to be oorganised. It takes time. There will need to be a transitional faze. Before

we go a quick web question on

Julian Assange, facing extradition proceedings in the

London Magistrate's Court as we

go to air. The question comes

from Indu Abeysekara in WA.

Does the panel agree that

Julian Assange has earned the Nobel Peace Prize for promoting the citizens to be informed of what

is done in their name? If not,

why not? Gerard Henderson, quick answer from everybody?

No, I don't think he deserves

the Nobel Peace Prize. Julian Assange wants to reveal the

secrets of all governments, but

wants to tell us very little

about himself. I'm not happy

about his current predicament,

but my advice to him originally

would have been don't go would have been don't go to

left-wing parties in Sweden,

just as my advice would have

been, having seen David's very good play, 'Don Parties On',

would be don't go to left-wing

parties and lower plenty. I think I think Assange needs to

be recognised for his

dismantling of the monopoly on information, but Noble Prize,

maybe a meat. I'm sure there's

more worthy people, Aung San

Suu Kyi, give him something,

but not the Noble Prize. You

couldn't possibly give him a

Noble Prize. Generally speaking, I support his charges against him are so

APPLAUSE dodgy, they are so dodgy.

. The charges may be dodgy,

but they are Swedish charges. They are nothing to do with the

United States Government.

That's the point. I'm not

saying you did, but many people

do,. There's no conspiracy. What he's alleged to have

done, and allegations are

really - they're so contradictory, so up and

minds. This is a fit-up job.

It's no the a fit-up job. It

Americans is. It mightn't be the

Americans doing it, but it is a

fit-up job. We're nearly out of

time. A really big award for

entertaining the world. I

couldn't wait to see the next

revelation of how much

hypocrisy it there is and

diplomacy. I didn't think the

Americans came out too badly.

A madman here, another one

there. But I thought it was

a meet tray, not the Noble hugely entertaining.

Paice Prize. My only rider to

that would be it's not easy, as

best I understand, to get to

actually look at the documents

yourself, they've been broken up into little bits and brought

together technically somewhere

out there in space. If he has wittingly or unwittingly, therefore recklessly, put

anybody's life at risk with

documents put out, sorry,

doesn't get a meat tray, he can

go straight to gaol. That's all

we have time for. No we'll have more to say on this

in future 'Q&A's. Please thank

Gerard Henderson, Catherine Deveny, Graham Richardson, David Williamson and Amanda

APPLAUSE Vanstone.

. Thank you. As predicted,

next Monday the 'Q&A' panel

will take a global tilt, with

controversial journalist and

WikiLeaks supporter John Pilger, Greg Sheridan,

Australian youth representative

to the UN, summer haddid, Craig

Emerson, former Communications

Minister Helen Coonan. Minister Helen Coonan. Join

Until then, good night. 'Q&A' next Monday at 9.35.

Closed Captions by CSI

Tonight - Perth's inferno. 64 homes destroyed and hundreds

forced to flee the fire

devastating the the city's south eastern suburbs. We're still

still not absolutely clear on

all the losses but they will be

This Program Is Captioned significant.

Good evening. Welcome to 'Lateline'. I'm Ali Moore. Tomorrow, Federal Parliament

sits for the first time in

2011. A year the government has

dubbed one of decision and

delivery. There's a lot at

stake with Julia Gillard seen

by many as still to put her own

stamp on the Prime Ministership

and shake off the remnants of

the Rudd era in which she was the Rudd era in which she was a

key player. Tonight we talk to Labor's Leader of the House Anthony Albanese about a range of issues, including the charge

by the government's own climate adviser Professor Ross Garnaut

that Australia's been a major

drag on international climate

action, and must do more if

it's to catch up. I don't think

it's a reasonable comment. I

think that Australia, certainly

under this government, has

taken climate change seriously.

And that contrasts with the We're determined

Howard Government, who inaction and denial of the

pretended that it didn't exist.

The Infrastructure Minister shortly but first our other headlines. Adding insult to

injury as the reconstruction of

North Queensland begins, police

arrest six people for looting.

And political stand-off. Egypt's opposition says government proposals to end the crisis don't go

has raged for more than 24

hours has finally been brought under control. 64 homes have been destroyed and another 32 damaged, but those numbers

could rise once the full extent of the devastation becomes clearer. Hundreds of

firefighters worked tirelessly

through the night, battling

bushfires north east and

south-east of Perth. Of

greatest concern, this blaze in the Hills the Hills suburb of Roleystone.

Many residents in the path of

the fire had little choice but

to get out. Just rang up and

said, you know, lock your doors

and windows and it's gotta

go. See at the top of each

road, a huge big line of fire

on the hill there. It's a very dangerous situation to stay

For those who left the night

was spent at evacuation centres

waiting to find out if their homes were still standing. Obviously we're

hoping fingers crossed that

it's still all OK. Some stayed to defend their properties. We're confident. Daybreak Daybreak provided some relief for firefighters but it also

gave a clearer view of what had

been lost. Scores of homes

burnt to the ground. Dozens more damaged. The Scarp is

always a horrendous place to

fight fires. We've been using

our aircraft today to good

effect. Ground crews are

getting in there. It's believed two

two of the homes destroyed

belonged to local firefighters flames and authorities

struggled to keep up with spot

fires. Worst day of my life. The premier has offered

financial assistance to the victims. The State Government

will make available immediately $3,000

$3,000 to those people who have

lost their homes, and $1,000 to

those people who have

experienced significant damage. Firefighters from Victoria have offered to out, and two extra heli-tanks

are on their way. Authorities

say they'll need the assistance

with fire crews facing another

long night. Jane Norman joins

us live from Roleystone about

35 kilometres south-east of

Perth. What's the situation

right now? Ali there is some

good news. The fire has been

brought under control and it's now only burning within

containment lines. containment lines. FESA has lifted its emergency warning

for residents in the Roleystone

and Kelmscott areas and now has

downgraded its advice to a

watch and act. What risk though a wind change and that

these flames could flare again? They've been battling

gusty easterly winds. There is

a chance that the winds could pick

pick up tonight and cause

another flare-up. But at this

stage fire crews are fairly

optimistic that the worst is now over. How soon until local

resident also be able to get

extent of the damage? Some

residents in the Clifton hills area have been allowed back

into their properties late this

afternoon. Clifton hills wasn't

really in the direct line of

the fire. And so it's been the fire. And so it's been left

relatively unscathed. So for

those residents who are in the

worst hit areas, it's pretty

unlikely they will be able to

return for some time, possibly tomorrow afternoon or even Wednesday morning at the

earliest. Simply because of the

amount of debris that remains in the area, and also the risk

that falling power poles and falling trees poses. Many

thanks. Today the Queensland

government formally expanded its Disaster Reconstruction Authority established after

jb's floods to include the

State's cyclone devastation.

It's named a senior Townsville

police officer to head the

cyclone recovery. It will be a

long haul for many small

communities between Townsville

and Cairns, a region which

thrives on agriculture and tourism. To make matters worse,

people have been charged with

looting over the weekend in

areas affected by the cyclone.

The business end of reconstructing Far North Queensland got under way in

earnest today at a community

Cabinet meeting in Airlie

Beach. The authority set up

after January's floods will now

be expanded to include areas

hit by cyclone Yasi. Reconstructing North

Queensland entirely out of a Brisbane office

Brisbane office means we won't have the on-the-ground understanding that Superintendent Mike Keating who is

is currently based in

Townsville will take up the position for the new coordinator of North Queensland's reconstruction. While the structural damage was limited

in Townsville parts of the city

remain without power tonight

and a lack of equipment has

seen the army getting back to

basics when clearing the

debris. We haven't got enough

chain sauce. It's a simple fact

all over Townsville. Any chainsaws

blunted so it's back to the

axes. Adding insult to the

psychological injuries of the

devastation, looters moved in

after the storm. Several shops in Townsville were broken into,

including this Japanese restaurant. Thieves stole a tip

bowl. A crime which shocked the owner. Everybody suffer from

the cyclone. If cyclone damage

here, I gave up. But human do

that. I can't believe it. people have so far been charged with stealing offences in

Townsville alone. And the

police officer who will head

the reconstruction authority for North Queensland says looting is a terrible crime. There is an increase in

penalty for people who are

caught and convicted of this

offence, they face a period of

up to 10 years in jail. It's

disheartening for business

owners an families and it reduces confidence. Over the

week whand frustrated the

clean-up effort in the

aftermath of the cyclone was

the lack of severely damaged towns further

north. I've done the right

thing and sat and found

accommodation with the kids and

they said you're right to get

through to Ingham. I come and I'm not. I'm running I'm not. I'm running out of

money. Got 10 bucks cash left. While the roads have now reopened authorities want

people to be understanding of

the many hurdles still to

come. We're doing everything we

can to support people getting

to their communities, back to

their homes, back to a position where

where they can sort out their

business. We'd ask them to be patient. We it's frustrating. Emergency warnings ensured people were well prepared for the cyclone.

But damage to the local economy

reliant entirely on agriculture and tourism is still being assessed. This is Australia's

biggest banana growing region. The crops have been flattened

and shops which catered to the

once booming tourist trade like

this fishing and camping store

don't know when they will be

back on their feet. In our

case, we prepared very well and

it was still really difficult. Unfortunately this is the kind

of thing you

for at all. Everything, all the

struts and everything are

gone. For Christina Harry and

her partner, the cyclone closed their business after 34

years of hard work. But they've

vowed to have the open for business sign up as soon as

they can. I think the town will

get relatively quick ly rebuilt. Everyone got stuck

into it. We knew it was coming.

The fact it was coming still

didn't prepare us for the

was just so frightening. It really was. WikiLeaks founder Julian

Assange has arrived at a court

in London to begin in London to begin his battle

against extradition to Sweden.

He faces allegations of sexual

of two women, claims he denies.

Rachel Brown is at hearing and

joins us now. What's the court

heard so far? The prosecution

has begun by outlining pretty

much a pre-emptive strike on the the arguments expected from

the defence. It's been

foreshadowed that the defence

will be challenging the

authority of the prosecutor in Sweden. The prosecution has

also thought up the issue of

double criminality. There has

been a lot of conjecture about

the breadth of the definition

of rape in Swedish law and the

prosecution says the defence

will be using that to argue

without bias the framework of

the UK's structures. The prosecution has

look it doesn't matter that the constituent elements are

different. It is still rape.

And fully able to make the

warrant and had permission from

the specialise ed crime

authority. Complainants have

come under much attacks and

have been vilified in the press

for changing their stories. And the way the conducted. And then finally and this relates to the possible

further extradition through the

US that Mr Sangakkara is

carried about --

Mr Assange is worried about,

there is no reason to presume

that the UK couldn't intervene

to make sure his human rights

weren't violated. What's the

atmosphere there today? It's a

circus. The world's to have descended on this

court. There are about 25

protesters with a banner I can

say "Make democracy possible".

Inside his court Inside his court he has his supporters, the investigative

journalists, Bianca Jagger. Geoffrey Robertson has just launched into the defence

argument. The defence is very

worried that Mr Assange will be

tried in secret. That's the way

a lot of the rape cases are

done in Sweden.

says this will be a flagrant

denial of justice, and not only

a democratic right but a

birthright. He is also worried

about trial by media. Julian

Assange he says has Assange he says has been

vilified in the Swedish press,

called a coward for not

returning to Sweden for questioning. He has also

launched an attack on the

victim's lawyer who he has

described as not a lawyer but a politician for the way he has

been conducting himself in the

press. When I left to speak to

you, Jeffrey Robertson

starting to go into some of the

defence of the charges he is

facing. The main argue amendment they will amendment they will be using is the prosecution has described

the rape as a minor rape, which

he says is laughable, no rape

could ever be described as

minor. In the UK, minimum rape

sentence could get between 0 to

4 years. But here Julian

Assange faces up to

five years in jail. In regards

to the other woman who has made the sexual assault allegation

Mrs Robertson argues that for

the first two charges the woman

did indeed consent, and she instructed Julian Assange to

use a condom which he did. So

Mr Robertson is arguing that

the charges haven't been spelt

out properly on the warrant. I

know that there is another day

to run in this for joining us from London. Thank you.

In Canberra, the politicians

have returned for the parliamentary new year, and

fresh battle lines are being drawn. The Prime Minister is

shaping the year ahead as the

one where she will deliver on

reforms as deep and far

reaching as those of the Hawke Keating

Keating years. The opposition

is painting her agenda as

policy on the run, akin to a

more recent Labor predecessor

Kevin Rudd. From Canberra,

political correspondent Tom

Iggulden reports. A new year, a new Prime Minister, and

unseasonal summer weather for

MPs returning to the national

capital. It's chilly. Chilly

indeed. Today's Newspoll has

slipping and Tony Abbott's the government's primary vote

narrowing the gap on preferred

Prime Minister. What do you

Julia Gillard make of the latest Newspoll and

Julia Gillard and Labor

slipping? I'm going to work

now. Thanks. Labor opened with a Cabinet meeting. (Laughter)

A bit of shush. The shadow Cabinet also met looking

leader. And that's energetic according to its

important. Because it is going

to be a big year in

politics. The first battle in

the parliamentary year is going

to be over the Prime Minister's

proposed flood levy, popular with voters according to the

Newspoll survey. Julia Gillard

plans to appoint former Liberal

Premier John Fahey to head an inspectorate which will look

into the Federal Government's

flood spending. Its aim is to

ensure that there is proper

accountability, scrutiny and

value for money. You should not

need a second ensure that the first

bureaucracy spends money

wisely. The battle over the

flood bill is just the curtain

raiser to the main show, or as

Julia Gillard puts it, the government's landmark reform

agenda. Act 1 will be health, where

where the Prime Minister will

try and hammer out a deal on

hospitals with State premiers

at next Monday's COAG meeting.

Though exactly what kind of

deal is uncertain. Asked

whether she'd be sticking with

Kevin Rudd's deal with the

for Federal Government hospital States on swapping GST revenue

funding, she was non-committal. People don't

judge their health care system

on Commonwealth/State financial

relations. They judge their

health care system on whether

they can find a doctor when they need one in their community . Whether they can

find a nurse when they need one

in their community. With the

Liberal Party gaining ascendancy in

ascendancy in key States Kevin

Rudd's year-old deal with the

premiers is coming under pressure. Julia Gillard may

well cut a deal at COAG but it

will mean an enormous backflip (and says the opposition with New South Wales expected to fall to the Liberal Party at

the end of the next week may have to be

revisited. To try to rush a

deal in the dying hours of that

government again just smacks of hypocrisy and desperation. hypocrisy and desperation. The same set of manic behaviour we saw from Kevin Rudd we're now

seeing from Julia Gillard. A

backflip or much-needed reform,

whatever you call it, it's an

important first test of Julia

Gillard's mettle.

A short time ago I spoke to

the government's leader in the house, Infrastructure and transport,

Anthony Albanese who was in our Parliament House studio. Welcome

Welcome to 'Lateline'. Good to

be with you. The first week of

Parliament for 2011 and against Parliament for 2011

the backdrop of so many natural disasters, the bushfires in

Perth, the floods, the cyclone

in Queensland, the floods in Victoria, as Infrastructure

Minister, I know it's early

days, but what could this all

end up costing the Federal

Government? We know what the

cost is at the moment of the

package and that's why package and that's why we

provided a full response to it.

Of course we have another event today. With the Western Australian bushfires, under the

formula that's been established

of course, once there is a

natural disaster declared, then the Commonwealth contribution

kicks in automatically. But you

know, we've got a

responsibility. We've got a responsibility to help, for

example, in Queensland, to

rebuild their roads, their bridges, their rail lines,

their ports, and we will be

providing that assistance of

course as well on the north

coast of New South Wales, in

Victoria, and in Western

Australia. And of course that package that you referred to,

the $5.6 billion, that number

only refers to the floods, it

doesn't refer to the cyclone t

doesn't refer to the very

latest flooding and it doesn't

refer to the bushfires. Is $5.6 billion starting to look rather

inadequate? Well, look we know

that last time with Cyclone Larry I'm advised to the Commonwealth was in the

order of $500 million. Of

course, it's too early to put a

final costing on final costing on what damage

the cyclone has had in

Queensland, and of course,

today, far too early to speculate about money. I think

today is a day for remembering

in Western Australia the damage

that's been done. That said of

course, Cabinet met today and

you have started the hunt for

that, what number are you more budget cuts. As

working on? What sort of target

have are you working on? Well, we

have our budget process. And

we'll work that through. We establish the $5.6 billion. work through a process to

With I think a very responsible

package, a package that

combined the $1.8 billion that

will be raised by the flood

levy. Applied in a very

progressive way. So that those

year won't people who earn under $50,000 a

And up to $100,000 a year, it

will be only $5 a week. So in

terms of that contribution and

then a series of deferrals, we

made sure, for example, in the

infrastructure package that we

put together, that we maintained our support for all

the projects which were already

contracted and are being rolled out. Because we understood how important productivity. As you search for

budget cuts, which you and the

Prime Minister have said you've

already started to do, what do

you work on? Do you work on

another $1 billion, another $2 billion, another $5

You must have some working

vague early-day estimate above the 5.6 you've already

identified? Well, as you would

expect, I'm not on your program

tonight in February to make our budget announcements

budget announcements which will

be worked through the pros is.

We'll work them through. We're determined to return the budget

to surplus in 2012-13. That's

an absolute commitment that we

have. We have a very response to the disasters which responsible

have occurred. We've got to

remember the human dimension of

this. The difficulties we might

have in terms of finding room

in the budget are nothing

compared with the real issue

which is that people have had

not only we've had lives lost,

but many more have had their lives destroyed. So can I

clarify while we heard about

the $5.6 billion package, there

won't be any other formal

announcement of how much the

Federal Government is going to

have to pay until the budget,

any further

will come with the budget? No,

there won't be an announcement

on your program tonight. But there

there will be one before the

budget? Well, that's a matter

for the Prime Minister and the

Treasurer with due respect. And

we will be making, though our

costings are fully known, as we

have with this. I mean I have

worked through now with the

State Governments, where have deferrals, have all been

accepted. That we've put

forward a total of 10 projects

in order to create that billion dollar dollar space which enables the

labour and the capital to be

used in rebuilding Queensland's

roads and bridges and rail

lines. Have you found that

billion? You have publicly

announced around 400 million of

it. Have you found the other

600? Yes we have and that's all

been worked through with the

States. And where is that in Victoria? There are six

projects in Queensland. There's one project in New South Wales.

The northern Sydney freight

line which will line which will be deferred

$100 million of that project.

And then two deferrals in

Victoria, $500 million for the regional rail link, and $20

million for the Princes Highway

east. Now, those positions have

all been accepted by the all been accepted by the

States. There is an

States. There is an understanding there that we that we need to rebuild

Victoria, and indeed, respond in Western Australia now as well as the north coast of New

South Wales. South Wales. Are welfare cuts on the table? Look, those

budget deliberations will take

place. And I'm not here tonight and it wouldn't be appropriate

for me to speculate and rule

things in or out. You wouldn't

expect me to, with due respect.

But we will make sure that we

can provide the consistent with returning the

budget to surplus in 2012-13.

How do you respond to Doug

Cameron, for example, who says

that welfare reform has that welfare reform has to be a

long-term approach, it's not

about short-term budget cuts? I

was in the caucus today and

that's actually not what Doug

Cameron said in the caucus. But

in terms of ... Did he talk in terms of ... Did he talk in

caucus about welfare cuts? No,

not at all. He talked about the

importance of work

those people who couldn't work.

So it was a constructive

discussion in the caucus. The

caucus is very united. Our caucus is moving forward

prepared to take the decisions

to ensure that Queensland can

be rebuilt, while Tony Abbott

and the opposition just snipe

at the sidelines, just oppose

oppose oppose. I note today Joe

Hockey did what Tony Abbott has

failed to do day after day, which is to admit that the

email which went out soliciting

donations for the Liberal Party

under the guise of opposing the

flood levy was inappropriate

and unacceptable and it

shouldn't have happened. Let's

get back to your spending and

in terms of overseeing the

spending of federal funds you have announced

have announced today a

reconstruction inspectorate

which will oversee the federal expenditure by the Queensland

reconstruction authority. That

inspectorate is going to answer

to a natural disaster recovery Cabinet subcommittee. On top of

that you're setting up a recovery task force. Why so much bureaucracy? We want to

make sure in terms of the

spending with the inspectorate, we've appointed three people. John Fahey, Martin Alberack

from Theiss and Matt Shearin

spend something overseen by from Deloittes to make sure the

people with experience, to make

sure that the value for every

dollar spent is achieved. What does it say about a Labor

Government thaw need a former

oversee federal Liberal minister to

that's not right at all. John

Fahey is a former Liberal

Cabinet minister. What it says

is that this is a government

partisan politics and appoint that's prepared to put aside

people of talent and ability.

John Fahey as someone who is a former New South Wales Premier

as well as a former federal

Finance Minister has a good

understanding of both State

finances as well as finances as well as federal

finances and the way that

budgets work. He's an

appropriate person as well

Mr Albrecht who has experience

as a former managing person in Theiss, in terms of a major construction company, and

Deloittes of course, a major Deloittes of course, a

corporate as well. Tony Abbott

says you shouldn't need a second bureaucracy to make sure

the first one is spending money

wisely. It does seem like a lot

of layers? Not at all. Not at all. I mean, Tony Abbott should

be embarrassed frankly by the

position he has taken on all of

these issues. When it comes to Tony

people a hand-up, he's put his

hand out for donations to the

Liberal Party. And I think,

frankly he, should be ashamed

of his effort over recent

days. With so many natural

disasters, doesn't it

permanent national disaster strengthen the argument for a

recovery fund? Look, we've got

to deal with the here and now,

Ali. We have had a real crisis.

I mean, already, we have infrastructure damage, we now

have in Queensland, all

airports open throughout

Queensland. An amazing

achievement. All ports up and

running. The Bruce Highway,

with some restrictions on it in terms

terms of speed and activity on

the Bruce hey way, but it's

open. All the way from Brisbane

to Cairns. That's an

been extraordinary effort. That's

been our priority, dealing with

the real concerns that are immediate, and we've made sure

that we're doing that. As for

there's an appropriate time and the medium and long term,

place for that discussion. But

we wanted to respond to the immediate crisis that

have Queenslanders in particular

to another issue. Your climate

adviser, your key climate adviser Professor Ross Garnaut

said today for the last 10

years, Australia has been a significant drag on

international efforts on

climate change. Is he right? If

you have a look back I think when we were elected to government, we signed the Kyoto

Protocol or ratified it as our

first action way back in

December and then we attended

the Bali conference. We've

contributed to the

international debate. This contributed to the

government put forward its carbon

carbon pollution reduction

scheme, argued for it. Put it

to the vote. Not once but

twice. Had the debate in the

House of Representatives and

the Senate. It was blocked by

the coalition. And the Greens

able to achieve that. But we

have of course also legislated

for a 20% renewable energy

target by 2020. We out of time. In essence you're

saying he's wrong? I don't think it's a reasonable

comment. I think that

Australia, certainly under this

government, has taken climate

change seriously. We're

determined to act on it. And

that contrasts with the

inaction and denial of the that Howard Government who pretended

said he is your key climate adviser? He is entitled to his

the Howard Government was opinion. But the fact is that

frozen in time while the world

warmed around it. We haven't

had that position, we turned it

around on Day 1 the day that we were sworn in at Government

House, and we've continued to

be determined to take action on

climate change. Climate change

is just one of the many issues

will you have to deal with this

year. Is 2011 make or break for

the Prime Minister, her one

chance to really put her stamp

on the snos Look, 2011 will be a year of decisiveness and

delivery for the Gillard

Government. And Julia Gillard? Julia has a big

support agenda. She has the united

support of the Labor team. And

we're determined to take action

this year, making sure on

issues such as putting a price

on carbon, but also, addressing major challenges in health reform, in driving change such as the skills reform, in driving through

agenda, address ing the

two-placed economy, all those issues we intend to address,

all while maintain bag

that returns the budget to responsible economic position

surplus in 2012-13. And no rumbling about the Prime

Minister's position? Oh come

on, Ali! The Prime Minister has

Prime Minister in August last just been re-elected as the

run. We've got a big agenda. year. We've got 2.5 years to

Labor Governments always have a

big vision. We've certainly big vision. We've certainly got

one, led by the Prime

Minister. And of course, Minister. And of course, just being re-elected, just would be

the operative word? Well, we

sit on the government bench,

Ali, and that means that you're

in a position to actually

effect change that has an

impact in improving the lives of everyday Australians. That's

our objective. Every morning we

wake up with that in mind and

we go to bed probably a bit

later than we'd like to at the nation. Minister, thank night,

you very much for talking to

'Lateline' ahead of such a busy

week in Canberra. Thanks, Ali. Egypt's opposition groups including the banned Muslim

Brotherhood say government

proposals on how to end the

political crisis don't go far

enough. Talks have produced

more concessions from the government, but failed to break

the impasse we protesters and

there is now no turning back US President Barack

for Egypt. Middle East correspondent Ben Knight

reports from Cairo. Cairo might

be looking more like its old self. But in Tahrir Square

there are still long lines of

people wanting to join this

protest. In the city the banks

are open and Cairo has had its

first traffic jam in over a

week. While Egyptians might be

happy to see law and order back

on the streets that doesn't

mean they have to like the you their traffic police are

corrupt and that the riot police are thugs but most

feared and detested of all are

the Secret Police. And in the past two weeks, they haven't

gone anywhere. Human rights watch says thousands of Egyptians have been detained by

the State since these protests

began. It's very brutal. People

are tortured. They receive

electric shocks. They're often sodomised by their

interrogators. They're beaten

very brutally. The organisation says this Egypt's new Vice-President,

Omar Sulieman , has himself

been involved in torture in his years as head of military

intelligence. Yesterday, Omar Sulieman sat down for talks

with the Muslim Brotherhood, an

opposition group whose members

have frequently been imprisoned

by his regime. The government

is offering some opposition

figures a place on a panel to

try and find a way forward to

free elections. And the

government's also promised that the foreign there were more arrests.

Reporters from the 'New York

Times' were also detained by

Egyptian authorities, and handed over to handed over to the Secret Police. The journalists say

interrogated throughout the

night and overheard protesters

being beaten. They wrote but

our discomfort paleed in

comparison to the dull whacks

and the screams of pain by

Egyptian people that broke the

stillness of the night. In one

instance, between the cries of

suffering and officers said in Arabic, you are talking to

journalist, you are talking

badly about our country. You are committing a sin. You are

committing a sin. Today the US

President said that change in

Egypt is now Egypt is now inevitable. Egypt

is not gonna go back to what it

was. The Egyptian people want

freedom. They want free and

fair elections. They want a

representative government. They

want a responsive

government. President Obama

also played down fears that the banned Muslim Brotherhood group

would take over from Hosni

Mubarak and expressed hope that any new Egyptian would remain an ally of the

United States. So it's

important for us not to say

that our only two options are

either the Muslim Brotherhood

or a suppressed ... But you don't want the Muslim

Brotherhood? What I want is a representative government in Egypt.

Egypt. Democracy, it's not.

And even so, more and more

Egyptians seem prepared to

trust this government to keep

its promise to change.

Now to the weather. Rain

developing in Brisbane.

That's all from us. If you want to want to look back with tonight's interview with

Anthony Albanese or review any

of 'Lateline''s stories or

transcripts you can visit our

web site and also follow us on

twit twipt and Facebook. I will

see you again tomorrow.

Goodnight. Closed Captions by CSI This Program Is Captioned

Live.

Good evening. Welcome to

Lateline Business. I'm Ticky

Fullerton. Tonight - retail subdued, subdued, with anemic growth in the run-up to Christmas. Consumers generally were just feeling things weren't that great. But not

everyone's doing it tough. We

talk to the Chairman of JB

Hi-Fi, Patrick Elliott, whose profit

profit growth is running in

double digits. And gearing up

for the reporting season. We

look at expectations in the big

end of town. We had a lot of

tail winds that came together for the lot of those now are reversing. People are paying down their

debts and being much more

conservative in conservative in their

approach. To the markets,

where retailers were a drag.

Investors and consumers have

abandoned one of Australia's biggest retailers. Shares in

department store high year

dived more than 11% today after

the company slashed its profit

of a fall in annual profits for outlook. Raising

the first time in five years.

The retail giant's poor

performance was reflected in

soft national retail sales

suggesting numbers for December,

suggesting that consumers are

battling headwinds. Shoppers

were throwing their bodies

around in typical fashion last

Christmas, but not necessarily

their money. The Reserve Bank hiked interest rates in November. The banks increased

their rates by more than that.

We had petrol prices going up

for equity markets. So I think during the quarter. We had

consumers generally were feeling things weren't that

great. The December retail

sales numbers weren't really

that great either. With sales

up a modest 0.2% as the floods

also started taking a toll in

Queensland. Sales of

discretionary items like

clothing an household goods clothing an household goods did

well but the biggest component,

food, was down for a second food, was down for a

straight month, and it was an uncharacteristically bad time

for department stores. But at

least cautious consumers will

have jobs. Job ads in rose for the newspapers

newspapers and on

rose for the 12th month in a

row to a two-year high. We'll

still get job growth through the first half of this year. don't think we'll match the

record jobs we saw during 2010.

It's a reason for consumers to

be cautious but the news is not

all bad. Myer has slashed its

profit guidance for the

financial year, after being hit

from all sides. A combination

of both deflation coming from interest rate rises which

started in November that

certainly had an impact on

consumer confidence, the unseasonal weather,

particularly the lack of warm weather, and the volatile

seasons that they're

encountering and also the

floods. Back in November, the

company expected a profit

increase between 5 and 10%. Now

Myer says profits could be down

by as much as 5%, the first

slump in five years. The

retailer's margins are being squeezed particularly in

clothing, where it's a big player. November and December were on-line from a profit were challenging, however, we

point of view, however, January

we've seen a rapid

deterioration in both sales and

consumer confidence. Investor confidence in Myer took a big confidence in

hit as well as the stock dived

more than 11%. At the same

time, Myer announced it has

bought 65% of fashion house

Sass & Bide. Call me cynical

but I think that's a side issue. I think it was

conveniently timed to come out today to possibly detract from

the fact that the Myer business

is actually seeing its earnings

base go down since IPI. It's

possibly strike one for current

management. And I suspect there

could be some mildly negative

news still to follow

retail climate. The climate

seemed far kinder to JB Hi-Fi,

where margins rose as the

electronics retailer said it

was on track to increase profit

by at least 13% this year, as

it opens more stores. JB Hi-Fi

posted a record half year

profit today of 88 million

dollars with over 8% sales

growth. Joining me now Patrick Elliott Chairman of JB

Hi-Fi and partner of private

equity firm Negotiation Capital. You're in expansion

mode still with your 210 mode still with your 210 store

target. You're on track for a

record year this year. What's allowing you to buck the

trend? I think there's a couple

of things working in our

favour. To start with we have a

relatively young store

portfolio. Those recently

opened stores will continue to

have been fortunate that grow above market rates. And we

historically we've been active

in that consumer electronics

technology space. There has been a lot of new product been a lot of

that's driven sales period. So I that's

period. So I think the that's driven sales period. So I think

combination of those things

will see us continue to grow at

least for the next four or five

years. You've been able to

fatten your profit margins. There's some could be partly due to

squeezing of suppliers. Is this

the case and if so, can you

continue to do this? I think

one of the benefits of our

business model is that we do

have an everyday low pricing

policy. We don't feed our sales

just on promotions. We are low

price every day. So what that

has meant is that we've been

able to meet the market on price without having to sacrifice margins. As larger our buying power has

improved and we continue to be

able to pass those on to

customers in the way of lower prices, again giving something

back to

think you will be able to put

this pressure on the suppliers

and continue it? I think it's certainly the margins we're

enjoying at the moment. They

should be sustainable. I think

we offer real benefit to those

suppliers in terms of reach to

the customer. And the larger we

are, the lower the cost of

doing business with those suppliers as well. I think it

works for everyone. Your

former stellar Chief

formally departed today. He's

spying on as a consultant but

less skin in the game. Some

analysts describe JB Hi-Fi now

as a mature business. Is that

how you describe it? Any time

you can grow your bottom line

by double digit rates you're

year far from mature. Richard left a

year ago in May this year, and

ter Terry Smart has done an

continue to grow the excellent job. He vit man to

business. Let me your growth strategy, and about on-line. Because there was

analysts today in the on-line quite a lot of focus by

sector. We're in a time where you have quite a lot of consumers now shifting their

spending in software area on CD, on DVDs, to on-line. Is